Bunge quarterly profit rises 17% on agribusiness boost
Feb 9 (Reuters) – Global farm commodities trader Bunge Ltd (BG.N) reported a 17.1% rise in fourth-quarter adjusted profit on Wednesday as large oilseed crops in North America and Europe and strong demand for processed meal and oil bolstered its core agribusiness.
The company forecast that strength would carry into 2022 amid rising demand for food and biofuel and tightening crop supplies, although the segment would likely not match last year’s record performance.
Bunge’s results offer the latest look into how multinational grain companies have weathered shifts in demand and supply chain disruptions caused by the COVID-19 pandemic.
Bunge and rival agribusinesses Archer-Daniels-Midland Co (ADM.N), Cargill Inc (CARG.UL) and Louis Dreyfus Co (AKIRAU.UL) — known as the ABCD quartet of grain trading giants — are now benefiting from improving demand for food and renewable fuel as some pandemic restrictions are easing.
Traders, however, are facing sharply higher raw materials costs as grain and oilseed prices have surged due to a likely South American harvest shortfall, while energy costs hover near multi-year highs.
Forecasters have been slashing harvest estimates for Brazil, the world’s top soy exporter and major corn supplier, due to adverse weather. Drought in neighboring Argentina has reduced harvest prospects there.
Bunge expects 2022 adjusted earnings of at least $9.50 per share, which the company said would be the second-highest operational performance in the its recent history.
The St. Louis, Missouri-based company posted adjusted net income of $533 million, or $3.49 per share, in the quarter ended Dec. 31, compared with $455 million or $3.05 per share, a year earlier.
That topped a consensus analyst estimate of $2.87 per share, Refinitiv Eikon data showed.
Revenue totaled $16.683 billion, up from $12.61 billion a year earlier and above an analyst estimate of $15.167 billion.
Reporting by Karl Plume in Chicago and Arunima Kumar in Bengaluru; editing by Uttaresh.V and Jason Neely